OceanX: Calculating capacity; carriers in the dock; Covid concerns climb
Big is still beautiful
India eased some lockdown restrictions yesterday, but bureaucratic hurdles still hamper interstate trucking.
According to the All India Motor Transport Congress (AIMTC), only 25-30% of truck fleets are on the road, and restrictions at state borders are “impeding their movement.”
Drivers are being “harassed and forcibly taken” for coronavirus testing, AIMTC said, claiming others were being subjected to “extortion and corruption”.
“They [drivers] must be treated humanely, as being in the service of the people is not a crime,” AIMTC said.
Another challenge is the lack of valid e-way bills required for crossing state borders. Introduced in 2018 alongside the Goods & Services Tax, e-way bills were hailed as bringing much-needed efficiency to India’s logistics industry by reducing barriers to cross-border trucking.
However, during the lockdown, e-way bills were only valid until 30 April and have yet to be extended, leaving some cargo and drivers in limbo.
Kultaran Singh Atwal, AIMTC president, said: “It is feared that a penalty on the value of goods may be slapped on the truckers. This will further curtail the movement of trucks in the country.”
Rakesh Pandit, co-founder and CEO of Conbox Logistics, told The Loadstar: “As the lockdown was only eased yesterday, it may take two-to-four days more to get clarity on transport movement of goods.”
As a result, road freight rates remain high, added Mr Pandit.
“Rates are up by 20-50% on average. And there is a shortage of drivers in the market, especially if someone wants to execute interstate shipments, which are still a big challenge.”
Similarly, said Mr Pandit, ocean freight costs had increased “drastically” for export cargo, especially for reefers, where prices have doubled on tradelanes such as India to the Middle East.
“Port congestion is still an issue as the majority of factories are closed due to different directives by various state governments,” he added. “But the situation has improved in the last two weeks and business is back to approximate 20-25% levels across different sectors of the economy.”
He warned of challenging times ahead for the country’s logistics players, however.
“The lockdown has resulted in a very tough situation for the logistics sector, which was already suffering before coronavirus, due to a slowdown in the economy.
“The current situation will give rise to more competition among domestic logistics players, as business conditions will take time to reach pre-Covid growth,” Mr Pandit said.